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World leaders gather to tackle the climate crisis via finanical means

French President Emmanuel Macron (R) and South Africa's President Matamela Cyril Ramaphosa greet at the Palais Brogniart for the New Global Financial Pact Summit in Paris.
French President Emmanuel Macron (R) and South Africa's President Matamela Cyril Ramaphosa greet at the Palais Brogniart for the New Global Financial Pact Summit in Paris. Copyright LUDOVIC MARIN/AFP
Copyright LUDOVIC MARIN/AFP
By Euronews with AP
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International political and business leaders are discussing reforms to the global financial system to better tackle climate and poverty challenges.

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World leaders, heads of international organizations and activists are gathering in Paris for a two-day summit aimed at finding better ways to tackle poverty and climate change by reshaping the global financial system.

Developing nations point to an outdated system where the United States, Europe, China, and other big economies historically responsible for most climate damage are now leaving the poorest countries to deal with the consequences.

The Paris talks also come as the COVID-19 pandemic, the war in Ukraine, and a global debt crisis have led to a drop in life expectancy and an increase in poverty in most countries around the world, according to the United Nations Development Program reported.

French President Emmanuel Macron, who organised the summit, said the fight against poverty, efforts to curb global warming and the protection of biodiversity are closely intertwined. "We therefore need to agree together on the best means to address these challenges in the poor and emerging countries," he said.

The Paris summit comes in the wake of a plan championed by Barbados Prime Minister Mia Mottley to ease access to financing for climate-vulnerable countries.

Mottley and other proponents have argued that developing countries are forced to pay such high interest rates that they struggle to finance adaptation projects, like sea walls, green energy initiatives, large solar farms, or simply make payments on outstanding loans when climate-infused disasters strike.

Forty heads of state and government are slated to attend the summit, many from poor and climate-vulnerable nations. 

Activists fear the talks won’t meet expectations.

What is to be discussed?

The Paris summit has no mandate to make formal decisions, French organizers stressed, but it aims at giving a strong political impetus to key issues to be discussed in upcoming climate conferences and other international meetings.

Experts are expected to announce Thursday that the pledge to provide poor nations with $100 billion in aid each year to tackle global change is estimated to be met for the first time this year. First made in 2009 and reaffirmed at the 2015 Paris climate summit, the promise had never been fulfilled.

Among key topics to be discussed are changes needed to the way the World Bank and the International Monetary Fund are lending and granting money to the most vulnerable countries. Both institutions have been criticized for not factoring climate change into lending decisions and being dominated by wealthy countries like the US.

Summit participants are expected to back a tax on the greenhouse gas emissions produced from international shipping, with the aim to enable its adoption at a July meeting of the International Maritime Organization.

To bring more money in, activists are pushing for a tax on the fossil fuel industry and another one on financial transactions — two proposals that appear to have little support from wealthier nations.

Debt restructuring and cancellation are also on the agenda, as a growing number of countries are struggling with unsustainable debt aggravated by climate change issues.

Participants will discuss a debt suspension clause for countries hit by extreme climatic events. However, activists note that it would have no impact on existing debt.

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